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Press Release
June 30, 2000


Middlefield Mutual Funds Limited (“MMF”) is pleased to announce that, in connection with the dissolution of MRF 1998 II Limited Partnership effective June 29, 2000 all of the assets of the Partnership were transferred to Middlefield Mutual Funds Limited, an open ended mutual fund, in exchange for the equivalent value of shares in MMF- Growth Class. For the purposes of the exchange, the net asset value of the Partnership was $552.49 per unit. As a result of the rollover, the total net assets of MMF- Growth Class increased from $49,000,000 to $73,200,000.

The transfer is a tax free exchange which means that no disposition occurs and therefore no capital gains tax is payable as a result of the rollover. The capital gains tax liability which would arise upon disposition can be deferred by retaining the shares of the mutual fund rather than redeeming them. In the event of redemption, the capital gains will be included in the shareholders tax return for that year when the shares are redeemed. Commencing in September, investors will have the opportunity to switch into other classes of mutual funds and still be able to defer capital gains taxes until they actually redeem their mutual fund shares for cash.

New MMF- Growth Class shareholders can determine their holdings by multiplying the number of units they held in the Partnership by 106.42. There are no fees charged on the transfer of units into MMF, nor on any redemption of the transferred assets. MMF is a no load fund which is RRSP eligible.

For further information, contact:

J. Dennis Dunlop
(416) 362-0714 J

   March 22, 2000


Middlefield Growth Fund Limited and MRF 1998 II Limited Partnership, jointly announced today that, in connection with the planned dissolution of the Partnership, they are proposing a transfer of all of the assets of the Partnership to Middlefield Growth Fund in exchange for mutual fund shares having the same aggregate net asset value as the aggregate net asset value of the Partnership. Appropriate elections under applicable income tax legislation will be made to effect the transfer on a tax-deferred basis.

The transfer is conditional upon (i) approval being obtained from the partners of the Partnership at a meeting called for that purpose and (ii) the receipt of all necessary regulatory approvals. It is currently intended that, if all necessary approvals are obtained, the transfer of assets to Middlefield Growth Fund and the subsequent dissolution of the Partnership shall occur on or about June 30, 2000.

The transfer has been proposed so as to provide greater benefits to both the partners of the Partnership and to the shareholders of the Mutual Fund from participating in a larger, more liquid mutual fund.

It is anticipated that by the time the transfer occurs, the Growth Fund shares will be exchangeable on a tax-free basis into other Middlefield mutual funds. Investors will then have the opportunity to diversify into other types of funds and will still be able to defer capital gains taxes payable upon disposition of their investment until they actually redeem their mutual fund shares. This new arrangement is, of course, subject to shareholder and regulatory approval.

For further information, contact Nancy Tham or the undersigned:

J. Dennis Dunlop
Senior Vice President
(416) 362-0714

March 31, 2000

We continue to be encouraged by the fundamental strength of the sector, which has yet to be reflected in the stock prices of our largest portfolio holdings: Burlington Resources, Tri Link Resources and Numac Energy. The investment portfolio as at March 29, 2000 was as follows:

Burlington Resources Inc. BRX $9,716,649 183,333 $12,780
Tri Link Resources Ltd. TLR 2,970,217 652,795 115
Numac Energy Inc. NMC 1,730,768 384,615 430
Canadian 88 Energy Corp. EEE 475,000 250,000 210
Merit Energy Ltd. MEL 132,000 550,000 10

The price of crude oil is close to its high for the past decade and natural gas prices are strong, yet the stock market could not seem to care less. Market watchers call this phenomenon a "disconnect", by which they mean a decoupling of two things that are – or should be – closely linked. Unless the market knows something that no one else does, there are many stocks available at bargain prices in the oil and gas sector.

Real value cannot be ignored forever. Not only is real value in the form of cash flow being created in oil and gas, but also the price for this value is now cheaper than it has been for a long time. Energy stocks are discounting a crude oil price of less than U.S. $20 a barrel average for the full year 2000 which seems a highly unlikely scenario viewed at this point in time. As well, major gains in the U.S. market are being made by the Canadian natural gas industry. Natural gas exports are growing at over 10% per annum with the export prices rising by over 15% as Canadian and U.S. wellhead prices continue to converge. Our largest stock position, Burlington Resources Inc. (BRX : TSE), as a major natural gas producer, is well positioned to participate in this growth. Its stock price during the past two weeks has risen over 20%.

There does not seem to be any compelling reason why stocks of most oil and gas companies are trading at multiples to cash flow substantially below the historical average for the industry. This leads us to conclude that the oil and gas group is significantly undervalued and that if our view is correct, the sector should see strong equity price appreciation over the next 12 to 18 months.

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